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Category Archives: Regulation A+

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Unlawful Crowdfunding? — SEC Institutes Public Administrative and Cease-and-Desist Proceeding Against Unregistered Broker-Dealer

Posted in Crowdfunding, Regulation A+, SEC News

In a proceeding on September 28th, the SEC ordered a public hearing to be held before an Administrative Law Judge within the next two months.  Further, the SEC ordered the Respondent and two companies under his control, to cease and desist from any engaging in any unlicensed and/or criminal acts of securities dealing. The Respondent… Continue Reading

No Portal Necessary

Posted in Capital Formation, Regulation A+

With increasing frequency, we are asked whether an issuer that is considering a Regulation A offering is required to engage or use the services of a funding portal. In short, NO. A funding portal is a new type of financial intermediary that performs certain limited functions in connection with Title III crowdfunded offerings. A funding… Continue Reading

Regulation A Roundup

Posted in Regulation A+

This week marks the three-month anniversary of the effective date of Regulation A.  Of course, given this limited experience, it may be premature to comment on market developments.  Instead, below we summarize significant developments. Small Entity Compliance Guide Immediately prior to the effective date, the Securities and Exchange Commission published this Small Entity Compliance Guide:… Continue Reading

It’s Not Crowdfunding!

Posted in Regulation A+

Since the Regulation A+ effective date last month, a number of websites have emerged that promote “Regulation A+ crowdfunding” contributing even further to the confusion in the market regarding “crowdfunding.” Colloquially perhaps any attempt to raise capital through the use of an internet-based platform may be thought of as crowdfunding; however, to a securities lawyer,… Continue Reading

SEC Guidance on Regulation A+

Posted in Regulation A+, SEC News

The SEC has provided guidance to issuers on Regulation A+ offerings.  You can access the SEC’s Small Entity Compliance Guide here:  http://www.sec.gov/info/smallbus/secg/regulation-a-amendments-secg.shtml. In addition, the SEC Staff has published a number of Compliance and Disclosure Interpretations, which may be accessed here: http://www.sec.gov/divisions/corpfin/guidance/securitiesactrules-interps.htm#182.01. For convenience, we have reprinted below the C&DIs. Section 182. Rules 251 to… Continue Reading

Complimentary Teleconference: Canadian Issuers and Regulation A+

Posted in Events, Regulation A+

On Thursday, June 25, 2015, Morrison & Foerster Partner Anna Pinedo will be joined by Blake, Cassels & Graydon Partner Pamela Hughes to present “Canadian Issues and Regulation A+”.  On June 19, 2015, the Regulation A+ rules adopted by the U.S. Securities and Exchange Commission became effective. Regulation A+ provides an important capital-raising alternative for private… Continue Reading

SEC Denies Motion to Stay Regulation A+

Posted in Regulation A+

On June 5, 2015, Monica J. Lindeen, Montana State Auditor, ex officio Commissioner of Securities and Insurance, filed a motion with the SEC for a stay of the Regulation A+ rules, which are scheduled to become effective this Friday.  In an order issued on July 16, 2015, the Commission denied the Montana motion.  The Commission… Continue Reading

OTC Markets Adopts Rule Changes

Posted in Regulation A+

The OTC Markets has adopted rule changes for OTCQX and OTCQB to accommodate for Reg A + and require quarterly disclosure for the OTCQX marketplace.  See below. OTCQB: http://www.otcmarkets.com/services/companies/otcqb/apply OTCQX for U.S. Companies: http://www.otcmarkets.com/services/companies/otcqx-us/pricing OTCQX for Banks: http://www.otcmarkets.com/services/companies/otcqx-banks/apply OTCQX for International Companies: http://www.otcmarkets.com/services/companies/otcqx-international/pricing

Massachusetts Challenges Regulation A+

Posted in Regulation A+

On May 22, 2015, William F. Galvin, the Secretary of the Commonwealth of Massachusetts, filed a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit seeking court review of the portion of SEC’s Regulation A+ rules which relate to preempting state law.  Galvin requests that the Court hold that… Continue Reading

Americans Stand On the Cusp of a Money Revolution

Posted in JOBS Act News, Regulation A+

Americans are standing on the cusp of a revolution in how we access and use money, a revolution that could make our economic lives more secure and our economy more robust. Just as e-commerce freed merchants and customers from geographic boundaries in the delivery of goods, advances in financial technology promise to make it easier… Continue Reading

Effective Date for Reg A+ this Summer

Posted in Regulation A+

Reg A (pron.: reg•gae) has the potential to become an important capital-raising alternative for emerging companies. With the final rules becoming effective on June 19th, turn to Morrison & Foerster for timely advice whether you are contemplating an offering or simply planning ahead.

Complimentary Teleconference: Structuring Your Regulation A+ Offering

Posted in Events, Regulation A+

On April 14, 2015, at 1:00 pm EST, Morrison & Foerster Partners Marty Dunn, David Lynn and Anna Pinedo will lead a teleconference on structuring Regulation A+ offerings. Now that the Securities and Exchange Commission has adopted final rules amending Regulation A, issuers, venture and private equity investors and financial intermediaries may want to consider a Regulation… Continue Reading

PLI Webinar: Capital-Raising using Regulation A+

Posted in Events, Regulation A+

On April 6, 2015, at 1:00 pm EST, Morrison & Foerster Partners Anna Pinedo and David Lynn, and Zachary O. Fallon, Special Counsel, Division of Corporation Finance, U.S. Securities and Exchange Commission (invited), will participate in a PLI Webinar on capital-raising using Regulation A+.  On March 25, 2015, the U.S. Securities and Exchange Commission unanimously… Continue Reading

A-Okay, Regulation A+

Posted in Regulation A+, SEC News

This is a very brief, initial summary.  We will be reporting on the final rule in an upcoming alert.  The SEC’s proposed rules already had provided a very practical format for private issuers seeking to raise capital.  The proposing release generated mixed comments, with practitioners largely supporting the SEC’s proposal, and others raising concerns about… Continue Reading

Chair White’s Testimony on SEC Initiatives

Posted in Dodd-Frank News, JOBS Act News, Regulation A+, SEC News

In testimony today, Chair White provided a brief update on various rulemaking initiatives.  She noted that, in connection with the Dodd-Frank Act mandates, the Division of Corporation Finance continues to work to implement provisions of the Dodd-Frank Act relating to executive compensation matters and payments by resource extraction issuers, and is currently conducting the review… Continue Reading

A+ or Not?

Posted in JOBS Act News, Regulation A+, SEC News

The SEC has scheduled an open meeting for this Wednesday to consider whether to adopt rules and forms related to the offer and sale of securities pursuant to Section 3(b) of the Securities Act of 1933 to implement Section 401 of the Jumpstart Our Business Startups Act—or, in other words, whether to adopt the Reg… Continue Reading

Reg A+ Debate Continues

Posted in Regulation A+

The debate regarding state preemption for Tier 2 Regulation A+ offerings appears to continue.  Late last week, a group of Congressmen sent a letter to SEC Chair White reaffirming their view that the SEC has authority to define the term “qualified purchaser” in the context of state preemption and reiterating that the approach taken by… Continue Reading

The More Things Change….

Posted in General Solicitation, Regulation A+, Regulation D, Rule 144A, Rule 506 Rulemaking, SEC News

Today, September 23rd, is the one year anniversary of the effective date of the changes relaxing the prohibition against general solicitation in certain offerings made under Rule 506 and resales made pursuant to Rule 144A. The SEC has not moved forward with the rules it proposed in 2013 that would make certain changes to Regulation… Continue Reading

Reg A+ Challenged Again

Posted in Regulation A+, SEC News

Another letter to the SEC from the Hill challenges the Regulation A+ proposal.  This time, the authors question the authority of the SEC in defining “qualified purchaser” as an offeree or purchaser in a Tier 2 Reg A+ offering.  The letter (available here:  http://www.nasaa.org/wp-content/uploads/2014/08/Senate_Regulation-A-Letter-FINAL-08-01-14.pdf) suggests that the SEC through the approach taken in its proposal… Continue Reading

Hearing on Oversight of the SEC’s Division of Corporation Finance

Posted in Crowdfunding, Regulation A+, SEC News

As we previously reported, the Director of the SEC’s Division of Corporation Finance, Keith Higgins, testified before the House Financial Services Committee on a broad range of matters, including the SEC’s progress in implementing the rules required by the Dodd-Frank Act and the JOBS Act, as well as the Division’s disclosure reform initiative.  Congressmen commented… Continue Reading

Future of Regulation A+ Uncertain

Posted in Regulation A+

Earlier this month a group of Congressmen wrote to SEC Chair White (see letter here:  http://www.sec.gov/comments/s7-11-13/s71113-114.pdf) regarding state preemption for Regulation A+ offerings.  The letter suggests that, at the time that the JOBS Act was being debated and considered, Congress was concerned about sales of securities in Reg A+ offerings to retail investors.  However, the… Continue Reading

Remarks of Sebastian Gomez Abero, Chief of the SEC’s Office of Small Business Policy, in an ALI Webcast Titled “Crowdfunding and Reg A+: New Routes for Raising Capital”

Posted in Crowdfunding, Events, Regulation A+

On May 22, 2014, Sebastian Gomez Abero, Chief of the Office of Small Business Policy of the Division of Corporation Finance of the SEC, spoke about the SEC’s crowdfunding and Regulation A+ proposals. Mr. Gomez commented generally on a number of comments and questions raised by commenters to the proposals. Mr. Gomez also noted that… Continue Reading

Hearing on Proposed JOBS Act Related Bills

Posted in JOBS Act News, Regulation A+

On May 1st, the House Financial Services Committee will hold a hearing (see:  http://financialservices.house.gov/calendar/eventsingle.aspx?EventID=377434) on various proposed bills related to the JOBS Act.  One of the bills addresses the crowdfunding framework and would have the effect of striking Title III of the JOBS Act and reverting to the House version of the crowdfunding title in… Continue Reading